(Reuters) – Bank of America and QBE Insurance Corp have agreed to pay $228 million to settle claims that they engaged in a kickback scheme inflating the cost of insurance that homeowners were forced to buy, according to a court filing.
The deal reached in Miami federal court is the latest of several multi-million-dollar settlements reached over "force-placed" insurance, which is coverage that lenders arrange to protect their interest in a property when a homeowner's insurance has lapsed.
Mortgage agreements do allow lenders to charge homeowners for the insurance, but lawsuits have accused banks of abusing that right by passing on to homeowners the costs of kickbacks they received from insurance providers.
Filed in 2012, the proposed class action against Bank of America and QBE Insurance Corp accused them of violating state and federal laws, including the U.S. Racketeer Influenced and Corrupt Organizations Act (RICO.) QBE Insurance Corp is part of Australia-based QBE Insurance Group Ltd..
Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader
Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- All PropertyCasualty360.com news coverage, best practices, and in-depth analysis.
- Educational webcasts, resources from industry leaders, and informative newsletters.
- Other award-winning websites including BenefitsPRO.com and ThinkAdvisor.com.
Already have an account? Sign In
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
